Bridges Weekly Trade News Digest • Volume 10 • Number 10 • 22nd March 2006
New Zealand, Brazilian Fish Proposals Under Fire
During sessions of the WTO Negotiating Group on Rules on 15 and 17 March, several Members criticised proposals put forward separately by Brazil and New Zealand for a fisheries-specific amendment to the Agreement on Subsidies and Countervailing Measures.
While welcoming the draft text from New Zealand (TN/RL/GEN/100) as a concrete proposal, a number of delegates said it was too broad in its scope and coverage, and inadequate in its provision of special and differential treatment (S&D) for developing countries. Most delegates also said that the proposal — which lays out a blanket ban on fisheries subsidies along with exemptions for permissible grants, as per the ‘top-down’ approach favoured by the "Friends of Fish" group — could have provided more detail about the conditions which would trigger exemptions for access payments, aquaculture, research related to fisheries management, vessel decommissioning, some infrastructure, certain social insurance programmes and natural disaster relief (see BRIDGES Weekly, 15 March 2006).
Many developing countries, among them some small and vulnerable coastal states, were particularly concerned about the proposal’s extension of disciplines to cover canned and processed fish. The Solomon Islands argued that new rules should not apply to subsidies given to such value-added activities in the interest of helping small and vulnerable economies develop their fishing industries. They also reminded Members that the purpose of the disciplines was to prevent over-fishing, and argued that they should therefore only cover capture fisheries and not aquaculture.
Approximately 25 developing countries, including Brazil, India and several Latin American and African, Caribbean and Pacific (ACP) countries, expressed disappointment with the S&D provisions in New Zealand’s draft text, which exempt a certain ‘de minimis’ amount of developing country subsidies from the general prohibition, but do not elaborate on how much, or the types of subsidies that would be exempted. Both the EU and the developing countries claimed that a ‘de minimis’ exemption was unlikely to be sufficient to allow these countries to pursue legitimate developmental and social objectives, and also asked for more detail on how such a provision could be applied in practice. Sources report that New Zealand suggested in the corridors that it was developing a new proposal on a ‘de minimis’ approach to S&D.
While the Brazilian text (TN/RL/GEN/79/Rev.1) paid significant attention to S&D-related concerns (see BRIDGES Weekly, 7 December 2005), its link between S&D and regional fisheries management organizations (RFMOs) raised the concern of both developing and developed countries as well as the environmental group Worldwide Fund for Nature (WWF) at an informal consultation held the night of 15 March. The proposal allows developing countries that are part of an RFMO to grant capacity-enhancing subsidies, so long as the fishing capacity remains within the sustainable level of exploitation as defined by the particular RFMO.
Norway, Japan, New Zealand and some developing countries suggested that many RFMOs do not have the capacity to determine the sustainability of fisheries for the purposes of the WTO. They also pointed out that many countries are not members of RFMOs and argued that the proposal’s criteria for non-RFMO members were too strict.
One trade expert also suggested that the proposal gives the WTO too much of a role in determining whether fisheries stocks are overexploited or not, suggesting that the eventual disciplines should rely on economic indicators. Another source noted that the vast majority of fishing takes place within countries’ exclusive economic zones, which are not usually covered by RFMOs.
Brazil’s proposal to carve out grants to "patently at risk" fisheries — those considered "overexploited," "depleted," or "recovering" by the UN Food and Agricultural Organisation — from the overall exemption for subsidies to developing-country small-scale and artisanal fisheries drew particularly heavy fire, with delegates questioning how this could be examined or proven in the WTO. Many developing country delegates pointed out that they considered artisanal and small-scale fisheries to be the same (the Brazilian paper defined them differently). A developing country delegate said that while artisanal fisheries in developing countries should be exempted from subsidy disciplines, those in developed countries should not.
Most developing countries welcomed India’s submission, which contained a list of "general characteristics" of small-scale, artisanal fisheries, which it felt could be more useful than trying to develop a common definition (TN/RL/W/203). They asked India to flesh out its propositions in the form of draft legal text that could be part of an agreement on fisheries subsidies.
ICTSD reporting.